RMC No. 06-2005: Circularizes the salient features of Supreme Court decision on waiver of the statute of limitations under the Tax Code

Summary

RMC No. 06-2005 circularizes the salient features of the Supreme Court decision in Philippine Journalists, Inc. vs. Commissioner of Internal Revenue, G.R. No. 162852, on waiver of the statute of limitations.

Key points

1. Requirements for a valid waiver. Under RMO No. 20-90, the waiver must state a definite agreed date within which the BIR may assess and collect. It must be accepted by the Commissioner or his authorized representative with the acceptance date indicated, and the taxpayer must receive a copy.
2. Strict construction. A waiver is to a certain extent a derogation of the taxpayer’s right to security against prolonged and unscrupulous investigations. It must be carefully and strictly construed.
3. Nature of the waiver. It does not waive the defense of prescription. It is an agreement that the period to assess and collect is extended to a date certain.
4. Bilateral agreement. A waiver is not a unilateral act of the taxpayer or the BIR but a bilateral agreement between the two.

Deadlines and effectivity

• Decision promulgated December 16, 2004

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.